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Chapter 18: Public Economy

Key Terms

Key Terms

the situation in which groups of legislators all agree to vote for a package of otherwise unrelated laws that they individually favor that politicians will try to match policies to what pleases the median voter preferences spending that benefits mainly a single political district the that rational people will not vote if the costs of becoming informed and voting are too high or because they know their vote will not be decisive in the election groups that are small in number relative to the nation, but well organized and thus exert a disproportionate effect on political outcomes the situation in which a majority prefers A over B, B over C, and C over A

Key Concepts and Summary

18.1 Voter Participation and Costs of Elections

The of says voters will recognize that their single vote is extremely unlikely to influence the outcome of an election. As a consequence, they will choose to remain uninformed about issues and not vote. This helps explain why voter turnout is so low in the United States.

18.2 Special Interest Politics

Special interest politics arises when a relatively small group, called a special interest group, each of whose members has a large interest in a political outcome, devotes considerable time and energy to lobbying for the group’s preferred choice. Meanwhile, the large majority, each of whose members has only a small interest in this issue, pays no attention. We define pork--barrel spending as legislation whose benefits are concentrated on a single district while the costs are spread widely over the country. refers to a situation in which two or more legislators agree to vote for each other’s legislation, which can then encourage in many districts.

18.3 Flaws in the Democratic System of Government

Majority votes can run into difficulties when more than two choices exist. A occurs when, in a situation with at least three choices, choice A is preferred by a majority vote to choice B, choice B is preferred by a majority vote to choice C, and choice C is preferred by a majority vote to choice A. In such a situation, it is impossible to identify what the majority prefers. Another difficulty arises when the vote is so divided that no choice receives a majority. A practical approach to microeconomic policy will need to take a realistic view of the specific strengths and weaknesses of markets as well as government, rather than making the easy but wrong assumption that either the or government is always beneficial or always harmful.

Self-Check Questions

1 . Based on the of , what should we expect to happen to voter turnout as the internet makes information easier to obtain? 2 . What is the cost of voting in an election? 3 . What is the main factor preventing a large community from influencing policy in the same way as a special interest group? 4 . Why might legislators vote to impose a tariff on Egyptian cotton, when consumers in their districts would benefit from its availability? 5 . True or false: Majority rule can fail to produce a single preferred outcome when there are more than two

Text from Principles of Microeconomics 3e, OpenStax, licensed CC BY-NC-SA 4.0. Access for free at openstax.org.

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